Ticketmaster And The Prof

A recent op-ed piece in the Wall Street Journal written by an economics professor blasted Ticketmaster for an aggressive, nationwide lobbying campaign to kill off secondary ticketing – a charge TM has called inaccurate.

Kent Smetters said TM is lobbying to change state laws across the U.S., making any ticket sold at $1 or more above face value in the secondary market illegal “unless it was resold by an issuer with a contract with the event’s organizer,” such as an NFL team or music venue.

When contacted by Pollstar, the associate professor at the Wharton School at the University of Pennsylvania backed up his article by providing references to several newspaper articles and even a copy of a bill Ticketmaster backed in Florida that he said would effectively give TM exclusive rights to the secondary market.

“I would say that my disappointment in Professor Smetter’s piece is that, at a high level, it makes some fundamental assumptions about what we’ve done and our intentions that are just actually incorrect,” Ticketmaster President Sean Moriarty told Pollstar.

First of all, it’s a case of the tail wagging the dog, according to Moriarty. TM is working to change legislation but it is on behalf of its clients, he said. The company has made efforts “to eliminate what we believe are outmoded and ineffective resale laws and to allow consumers to safely and freely resell tickets above face value. And we’ve endeavored to do that in every single state where these resale laws are on the books.”

Recent articles say Ticketmaster comes out ahead in any new legislation. The company already has contracts with many sports teams and event organizers in the primary ticket market, and would be one of the first to reap the benefits with the passage of the secondary market legislation.

Essentially, Ticketmaster could sell the primary ticket, and “would also be the sole legal channel through which tickets could be resold at additional markups in the secondary market,” Smetters wrote in the WSJ.

Moriarty doesn’t see it that way.

“We believe one of the fundamental misconceptions is that in certain cases, the legislative effort that we’ve undertaken has been characterized as an effort to have the secondary market to ourselves, and nothing could be further from the truth.

“We know that there are multiple resell options out there and we think that in the same way that clients have a choice around primary market ticketing, they should have a choice around secondary market ticketing as well,” he said.

But along with that choice comes responsibility, Moriarty said, on the part of TM and the consumer.

“We have in our business always worked on behalf of our clients, the event organizers, promoters, venues and teams to represent their interests and help them in any appropriate way that we can.

“A team has the right to ask its season ticket holders to behave in certain ways when they become season ticket holders and if a team desires to have a season ticketholder base comprising fans who are going to the games, as opposed to scalpers and speculators who buy those tickets solely so that they can have premium inventory, I think it’s perfectly appropriate.”

Moriarty said the same idea applies to artists who operate fan clubs.

“They would like to provide to their fan club membership in some cases the ability to have access to certain tickets in return for their loyalty over the years. And those artists would ask that fan club members who gain access to those tickets not in fact be brokers and scalpers who are joining the fan club merely so they can access that inventory and resell it.”

Ticketmaster has taken a firm stance against scalpers, in some cases going as far as invalidating tickets found for sale in the secondary market. In May, the company, along with Tom Petty‘s management, canceled nearly 460 tickets that had been set aside for members of Petty’s fan club, but instead were being sold through secondary outlets.

Some would call that move, and the legislation currently being pursued, outrageous.

But Moriarty said the company is merely pursuing a system that will provide a safe and legal resale to the benefit of the consumer and all companies involved in the secondary ticket market.

“Ultimately, in order to really get resale right, there has got to be a fundamental sense of fairness for all parties involved,” he said.

– Dana Parker-McClain